Payroll tax disputes often arise when a worker is paid as an independent contractor, but the IRS or California Employment Development Department (EDD) believes that the worker is an employee. There are some differences between federal and state requirements, but a business will often have to deal with both the…
The California Franchise Tax Board (FTB) encourages taxpayers facing a financial hardship to work with the FTB to find a way to pay off their tax debt. The FTB can give California taxpayers more time to pay, or settle tax debt for less than the full amount in some cases.…
If you owe tax and fail to file a return on time, the IRS can assess both civil and criminal tax penalties. The penalty for failure to file is separate from the penalty for failure to pay taxes, and both civil and criminal penalties can be assessed for the same…
The IRS Offshore Voluntary Disclosure Program (OVDP) offers taxpayers with unreported income from foreign financial accounts a chance to come into compliance with the law. The program benefits taxpayers by offering lower penalties and eliminating the threat of criminal prosecution for failing to file Foreign Bank Account Reports (FBARs). Failure…
The IRS Classification Settlement Program (CSP) is designed to allow businesses to settle a tax debt owed due misclassifying employees as independent contractors. Along with safe harbor relief under Section 530, the CSP can be an effective tool for businesses involved in payroll tax disputes. The Costs of Misclassifying Employees…
The IRS expanded its streamlined filing compliance procedures in 2014 to allow more taxpayers with offshore bank accounts to take advantage of the program. The procedures are now available to some taxpayers living in the United States, as well as many U.S. taxpayers living outside the country. Benefits of Streamlined…
The Bank Secrecy Act may require you to file a FinCEN 114, Report of Foreign Bank and Financial Accounts (FBAR), even if you are not a U.S. Citizen. The FBAR must be filed annually by all “United States Persons”, which includes U.S. citizens, U.S. residents, and certain entities. The FBAR…
An abusive tax shelter is an investment scheme that attempts to reduce income tax without serving any other economic purpose. The value of income or assets is not changed, so the sole purpose of an abusive tax shelter is to avoid tax. The IRS attempts to deter participations in abusive…
The IRS is a fearsome creditor that can gain access to many of your assets to satisfy your tax debt. Unlike other creditors it doesn’t need to bring a lawsuit to go after you’re the bulk of your assets. The IRS has the ability to use any of the following…
Before you relinquish your U.S. citizenship in order to avoid paying taxes, be advised that some taxpayers will be subject to an expatriation tax, also known as the “exit tax” upon renunciation of citizenship. The IRS will effectively act as though you sold all of your worldwide assets in a…